Commonwealth Bank CEO Matt Comyn to keep $1.6m gift amid protest

Investors will lodge a protest vote against a controversial $1.6m equity grant to Commonwealth Bank CEO Matt Comyn, but the measure is likely to be passed.

CBA chief executive Matt Comyn.

Investors will lodge a protest vote against a controversial, $1.6m equity grant to Commonwealth Bank chief executive Matt Comyn, but the measure is likely to be passed.

Ahead of Tuesday’s annual meeting, influential proxy adviser ISS recommended a “no” vote to its institutional clients, which are mostly passive, offshore funds.

The protest vote is likely to be in the mid-to-high teens.

CBA has countered that maximum remuneration for the bank’s senior executive team will fall by about 19 per cent from 2021, with Mr Comyn’s pay declining by 12 per cent.

The bank has also said Mr Comyn is being rewarded for his leadership in the pandemic, both for the industry and in its dealings with the federal government.

ISS took a contrary position to other groups, including Ownership Matters, CGI Glass Lewis, the Australian Shareholders’ Association on behalf of retail investors, and the Australian Council of Superannuation Investors, mostly for industry funds.

It said the grant of so-called restricted share units was similar to deferred fixed pay, labelling it “regressive” and inconsistent with the treatment of regular staff in recent pay negotiations.

The adviser was also highly critical of the CBA board’s stated intention to provide Mr Comyn’s benefit in another form, including deferred cash payments, if the equity grant is voted down.

It said investors had effectively been ­deprived of the right to approve or reject a contentious component of the bank’s remuneration structure.

Investors are also considered likely to pass the CBA remuneration report.

Meanwhile, the number of CBA customers with loan deferrals continues to fall sharply, as the industry weans customers off its COVID-19 support measures.

CBA’s September figures revealed a total of 129,000 loan deferral payments — down from 174,000 in August and 210,000 in June. Balances fell to $42bn, down from $59bn in August and $67bn in June.

However, Mr Comyn said Victorian customers faced additional pressure, with Premier Daniel Andrews extending the state of emergency by four weeks on Sunday.

“Latest figures for September show an encouraging trend in the number of our home loan and SME lending customers who are able to return to making repayments on their loans,” Mr Comyn said on Monday.

“While these trends are encouraging, we are conscious that many of our customers still require our ongoing support, particularly in regions most affected by COVID-19, such as Victoria, which is reflected in requests for deferral extensions.”

The net reduction in loan deferrals included 21,000 home loans totalling $8bn and 23,000 small business loans worth $8bn.

CBA said 52,000 home loans worth $20bn and 28,000 SME loans totalling $2.8bn were due to expire in October, but would be subject to possible extensions.

In June, CBA became the first of the big four banks to begin winding back its COVID support measures.

On Friday, the RBA forecast that the number of non-performing household loans would increase over the coming months as customers transitioned off deferral plans.

It said banks estimated 15 per cent of deferred loans were at risk of not being able to meet their repayment schedule when the deferral period ended.